I've on and off wondered how "safe" Roth accounts and things like this
anti-Roth screed in the LATimes:
and this blog post:
talking about the sad fiscal shape of the US has me wondering again.
While I don't think that Congress will be able to get away with
directly taxing qualified Roth withdrawals, I've more and more thought
that we're going to end up seeing stuff like qualified Roth
withdrawals being included in the taxability-of-SS-benefits
calculation or becoming an AMT preference item or maybe even the
repealed-in-1997 excess accumulation tax on IRAs returning and
applying to Roth IRA distributions in excess of some amount.
Now, certainly if your trad IRA contribution is going to be
non-deductible then making a Roth contribution (or tIRA contribution
followed by immediate conversion if your income doesn't allow the full
Roth contribution) is pretty much a no-brainer.
But in other cases, especially if you are in the 25% federal bracket
or higher, what do you think? Better to at least get the certain bird
in hand (the current-year tax deduction)? Or pay the taxes now
figuring rates will be higher later but that the fisc won't be so bad
that Rothees will be screwed by stuff like above? Where do you see it
- posted 9 years ago